Deming Philosophy Synopsis
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Deming Philosophy Synopsis
The philosophy of W. Edwards Deming has been summarized as follows:
- "Dr. W. Edwards Deming taught that by adopting appropriate principles of management, organizations can increase quality and simultaneously reduce costs (by
reducing waste, rework, staff attrition and litigation while increasing customer loyalty). The key is to practice continual improvement and think of
manufacturing as a system, not as bits and pieces."
In the 1970s, Deming's philosophy was summarized by some of his Japanese proponents with the following 'a'-versus-'b' comparison:
(a) When people and organizations focus primarily on quality, defined by the following ratio,
Quality = Results of work efforts / Total costs
quality tends to increase and costs fall over time.
(b) However, when people and organizations focus primarily on costs, costs tend to rise and quality declines over time.
The Deming System of Profound Knowledge
"The prevailing style of management must undergo transformation. A system cannot understand itself. The transformation requires a view from outside. The aim
of this chapter is to provide an outside view—a lens—that I call a system of profound knowledge. It provides a map of theory by which to understand the
organizations that we work in.
"The first step is transformation of the individual. This transformation is discontinuous. It comes from understanding of the system of profound knowledge.
The individual, transformed, will perceive new meaning to his life, to events, to numbers, to interactions between people.
"Once the individual understands the system of profound knowledge, he will apply its principles in every kind of relationship with other people. He will have
a basis for judgment of his own decisions and for transformation of the organizations that he belongs to. The individual, once transformed, will:
- Set an example;
- Be a good listener, but will not compromise;
- Continually teach other people; and
- Help people to pull away from their current practices and beliefs and move into the new philosophy without a feeling of guilt about the past."
Deming advocated that all managers need to have what he called a System of Profound Knowledge, consisting of four parts:
- Appreciation of a system: understanding the overall processes involving suppliers, producers, and customers (or recipients) of goods and
services (explained below);
- Knowledge of variation: the range and causes of variation in quality, and use of statistical sampling in measurements;
- Theory of knowledge: the concepts explaining knowledge and the limits of what can be known.
- Knowledge of psychology: concepts of human nature.
Deming explained, "One need not be eminent in any part nor in all four parts in order to understand it and to apply it. The 14 points for management in
industry, education, and government follow naturally as application of this outside knowledge, for transformation from the present style of Western management
to one of optimization."
"The various segments of the system of profound knowledge proposed here cannot be separated. They interact with each other. Thus, knowledge of psychology is
incomplete without knowledge of variation.
"A manager of people needs to understand that all people are different. This is not ranking people. He needs to understand that the performance of anyone is
governed largely by the system that he works in, the responsibility of management. A psychologist that possesses even a crude understanding of variation as will
be learned in the experiment with the Red Beads (Ch. 7) could no longer participate in refinement of a plan for ranking people."
The Appreciation of a system involves understanding how interactions (i.e., feedback) between the elements of a system can result in internal
restrictions that force the system to behave as a single organism that automatically seeks a steady state. It is this steady state that determines the output of
the system rather than the individual elements. Thus it is the structure of the organization rather than the employees, alone, which holds the key to improving
the quality of output.
The Knowledge of variation involves understanding that everything measured consists of both "normal" variation due to the flexibility of the system
and of "special causes" that create defects. Quality involves recognizing the difference to eliminate "special causes" while controlling normal variation.
Deming taught that making changes in response to "normal" variation would only make the system perform worse. Understanding variation includes the mathematical
certainty that variation will normally occur within six standard deviations of the mean.
The System of Profound Knowledge is the basis for application of Deming's famous 14 Points for Management, described below.
Deming offered fourteen key principles to managers for transforming business effectiveness. The points were first presented in his book Out of the
Crisis. (p. 23-24)
Although Deming does not use the term in his book, it is credited with launching the Total Quality Management movement.
Create constancy of purpose toward improvement of product and service, with the aim to become competitive, stay in business and to provide jobs.
Adopt the new philosophy. We are in a new economic age. Western management must awaken to the challenge, must learn their responsibilities, and take on
leadership for change.
Cease dependence on inspection to achieve quality. Eliminate the need for massive inspection by building quality into the product in the first place.
End the practice of awarding business on the basis of a price tag. Instead, minimize total cost. Move towards a single supplier for any one item, on a
long-term relationship of loyalty and trust.
Improve constantly and forever the system of production and service, to improve quality and productivity, and thus constantly decrease costs.
Institute training on the job.
Institute leadership (see Point 12 and Ch. 8 of "Out of the Crisis"). The aim of supervision should be to help people and machines and gadgets do a better
job. Supervision of management is in need of overhaul, as well as supervision of production workers.
Drive out fear, so that everyone may work effectively for the company. (See Ch. 3 of "Out of the Crisis")
Break down barriers between departments. People in research, design, sales, and production must work as a team, in order to foresee problems of production
and usage that may be encountered with the product or service.
Eliminate slogans, exhortations, and targets for the work force asking for zero defects and new levels of productivity. Such exhortations only create
adversarial relationships, as the bulk of the causes of low quality and low productivity belong to the system and thus lie beyond the power of the work
a. Eliminate work standards (quotas) on the factory floor. Substitute with leadership.
b. Eliminate management by objective. Eliminate management by numbers and numerical goals. Instead substitute with leadership.
a. Remove barriers that rob the hourly worker of his right to pride of workmanship. The responsibility of supervisors must be changed from sheer numbers to
b. Remove barriers that rob people in management and in engineering of their right to pride of workmanship. This means, inter alia, abolishment of the
annual or merit rating and of management by objective (See Ch. 3 of "Out of the Crisis").
Institute a vigorous program of education and self-improvement.
Put everybody in the company to work to accomplish the transformation. The transformation is everybody's job.
"Massive training is required to instill the courage to break with tradition. Every activity and every job is a part of the process."
Seven Deadly Diseases
The "Seven Deadly Diseases" include:
- Lack of constancy of purpose
- Emphasis on short-term profits
- Evaluation by performance, merit rating, or annual review of performance
- Mobility of management
- Running a company on visible figures alone
- Excessive medical costs
- Excessive costs of warranty, fueled by lawyers who work for contingency fees
"A Lesser Category of Obstacles" includes
- Neglecting long-range planning
- Relying on technology to solve problems
- Seeking examples to follow rather than developing solutions
- Excuses, such as "our problems are different"
- Obsolescence in school that management skill can be taught in classes
- Reliance on quality control departments rather than management, supervisors, managers of purchasing, and production workers
- Placing blame on workforces who are only responsible for 15% of mistakes where the system designed by management is responsible for 85% of the unintended
- Relying on quality inspection rather than improving product quality
Deming's advocacy of the Plan-Do-Check-Act cycle, his 14 Points, and Seven Deadly Diseases have had tremendous influence outside of manufacturing and have
been applied in other arenas, such as in the relatively new field of sales process engineering
Quotations and concepts
In his later years, Deming taught many concepts, which he emphasized by key sayings or quotations that he repeated. A number of these quotes have been
Some of the concepts might seem to be oxymorons or contradictory to each other; however, the student is given each concept to ponder its meaning in the whole
system, over time.
- "There is no substitute for knowledge." This statement emphasizes the need to know more, about everything in the system. It is considered as a
contrast to the old statement, "There is no substitute for hard work" by Thomas Alva Edison (1847–1931). Instead, a small amount of knowledge could save many
hours of hard work.
- ""In God we trust; all others must bring data." (Trevor Hastie, Robert Tibshirani, and Jerome Friedman, co-authors of The Elements of Statistical
Learning in their Preface to the Second Edition have a footnote which reads: "On the Web, this quote has been widely attributed to both Deming and Robert W.
Hayden; however Professor Hayden told us that he can claim no credit for this quote, and ironically we could find no 'data' confirming Deming actually said
this.") - The quote in The Elements of Statistical Learning actually reads "In God we trust, all others bring data."
- "The most important things cannot be measured." The issues that are most important, long term, cannot be measured in advance. However, they might be
among the factors that an organization is measuring, just not understood as most important at the time.
- "The most important things are unknown or unknowable." The factors that have the greatest impact, long term, can be quite surprising. Analogous to an
earthquake that disrupts service, other "earth-shattering" events that most affect an organization will be unknown or unknowable, in advance. Other examples of
important things would be: a drastic change in technology, or new investment capital.
- "Experience by itself teaches nothing."
This statement emphasizes the need to interpret and apply information against a theory or framework of concepts that is the basis for knowledge about a system.
It is considered as a contrast to the old statement, "Experience is the best teacher" (Deming disagreed with that). To Deming, knowledge is best taught by a
master who explains the overall system through which experience is judged; experience, without understanding the underlying system, is just raw data that can be
misinterpreted against a flawed theory of reality. Deming's view of experience is related to Shewhart's concept, "Data has no meaning apart from its
- "By what method?... Only the method counts."
When information is obtained, or data is measured, the method, or process used to gather information, greatly affects the results. For example, the "Hawthorne
effect" showed that people just asking frequently for opinions seemed to affect the resulting outcome, since some people felt better just being asked for their
opinion. Deming warned that basing judgments on customer complaints alone ignored the general population of other opinions, which should be judged together,
such as in a statistical sample of the whole, not just isolated complaints: survey the entire group about their likes and dislikes (see
Sampling (statistics)). The extreme complaints might not represent the attitudes of the whole group. Similarly, measuring or counting data depends on the
instrument or method used. Changing the method changes the results. Aim and method are essential. An aim without a method is useless. A method without an aim is
dangerous. It leads to action without direction and without constancy of purpose. Deming used an illustration of washing a table to teach a lesson about the
relationship between purpose and method. If you tell someone to wash a table, but not the reason for washing it, they cannot do the job properly (will the table
be used for chopping food or potting plants?). That does not mean just giving the explanation without an operational definition. The information about why the
table needs to be washed, and what is to be done with it, makes it possible to do the job intelligently.
- "You can expect what you inspect." Deming emphasized the importance of measuring and testing to predict typical results. If a phase consists of
inputs + process + outputs, all 3 are inspected to some extent. Problems with inputs are a major source of trouble, but the process using those inputs can also
have problems. By inspecting the inputs and the process more, the outputs can be better predicted, and inspected less. Rather than use mass inspection of every
output product, the output can be statistically sampled in a cause-effect relationship through the process.
- "Special Causes and Common Causes": Deming considered anomalies in quality to be variations outside the control limits of a process. Such variations
could be attributed to one-time events called "special causes" or to repeated events called "common causes" that hinder quality.
- Acceptable Defects: Rather than waste efforts on zero-defect goals, Deming stressed the importance of establishing a level of variation, or
anomalies, acceptable to the recipient (or customer) in the next phase of a process. Often, some defects are quite acceptable, and efforts to remove all defects
would be an excessive waste of time and money.
- The Deming Cycle (or Shewhart Cycle): As a repetitive process to determine the next action, the Deming Cycle describes a simple method to test
information before making a major decision. The 4 steps in the Deming Cycle are: Plan-Do-Check-Act (PDCA), also known as Plan-Do-Study-Act or PDSA. Deming
called the cycle the Shewhart Cycle, after
Walter A. Shewhart
The cycle can be used in various ways, such as running an experiment: PLAN
(design) the experiment; DO the experiment by performing the steps; CHECK the results by testing information; and ACT on the decisions based on those
- Semi-Automated, not Fully Automated: Deming lamented the problem of automation gone awry ("robots painting robots"): instead, he advocated human-
assisted semi-automation, which allows people to change the semi-automated or computer-assisted processes, based on new knowledge. Compare to Japanese term
'autonomation' (which can be loosely translated as "automation with a human touch").
- "The problem is at the top; management is the problem."
Dr. Deming emphasized that the top-level management had to change to produce significant differences, in a long-term,
continuous manner. As a consultant, Deming would offer advice to top-level managers, if asked repeatedly, in a continuous manner.
- "What is a system? A system is a network of interdependent components that work together to try to accomplish the aim of the system. A system must have
an aim. Without an aim, there is no system. The aim of the system must be clear to everyone in the system. The aim must include plans for the future. The aim is
a value judgment. (We are of course talking here about a man-made system.)"
- "A system must be managed. It will not manage itself. Left to themselves in the Western world, components become selfish, competitive. We can not afford the destructive effect of competition."
- "To successfully respond to the myriad of changes that shake the world, transformation into a new style of management is required. The route to take is
what I call profound knowledge—knowledge for leadership of transformation."
- "The worker is not the problem. The problem is at the top! Management!"
Management’s job. It is management’s job to direct the efforts of all components toward the aim of the system. The first step
is clarification: everyone in the organization must understand the aim of the system, and how to direct his efforts toward it. Everyone must understand the
damage and loss to the whole organization from a team that seeks to become a selfish, independent, profit centre."
- "They realized that the gains that you get by statistical methods are gains that you get without new machinery, without new people. Anybody can produce
quality if he lowers his production rate. That is not what I am talking about. Statistical thinking and statistical methods are to Japanese production workers,
foremen, and all the way through the company, a second language. In statistical control, you have a reproducible product hour after hour, day after day. And see
how comforting that is to management, they now know what they can produce, they know what their costs are going to be."
- "I think that people here expect miracles. American management thinks that they can just copy from Japan—but they don't know what to copy!"
- "What is the variation trying to tell us about a process, about the people in the process?"
Dr. Shewhart created the basis for the control chart and the concept of a state of statistical control by carefully designed experiments. While Shewhart drew from pure mathematical statistical theories, he understood that data from physical processes never produce a "normal distribution curve" (a Gaussian distribution, also commonly referred to as a "bell curve"). He discovered that observed variation in manufacturing data did not always behave the same way as data in nature (Brownian motion of particles). Shewhart concluded that while every process displays variation, some processes display controlled variation that is natural to the process, while others display uncontrolled variation that is not present in the process causal system at all times.
Deming renamed these distinctions "common cause" for chance causes and "special cause" for assignable causes. He did this so the focus would be placed on those responsible for doing something about the variation, rather than the source of the variation. It is top management’s responsibility to address "common cause" variation, and therefore it is management’s responsibility to make improvements to the whole system. Because "special cause" variation is assignable, workers, supervisors or middle managers that have direct knowledge of the assignable cause best address this type of specific intervention.
- (Deming on Quality Circles) "That's all window dressing. That's not fundamental. That's not getting at change and the transformation that must take place. Sure we have to solve problems. Certainly stamp out the fire. Stamp out the fire and get nowhere. Stamp out the fires puts us back to where we were in the first place. Taking action on the basis of results without theory of knowledge, without theory of variation, without knowledge about a system. Anything goes wrong, do something about it, overreacting; acting without knowledge, the effect is to make things worse. With the best of intentions and best efforts, managing by results is, in effect, exactly the same, as Myron Tribus put it, while driving your automobile, keeping your eye on the rear view mirror, what would happen? And that's what management by results is, keeping your eye on results."
- "Knowledge is theory. We should be thankful if action of management is based on theory. Knowledge has temporal spread. Information is not knowledge. The
world is drowning in information but is slow in acquisition of knowledge. There is no substitute for knowledge."
This statement emphasizes the need for theory of knowledge.
- "Uncertainty makes research predictable, but you still need proof to satisfy everyone else."
Deming was referencing the sometimes paradoxical aspects of research.
- "The most important figures that one needs for management are unknown or unknowable (Lloyd S. Nelson, director of statistical methods for the Nashua
corporation), but successful management must nevertheless take account of them."
Deming realized that many important things that must be managed couldn’t be measured. Both points are
important. One, not everything of importance to management can be measured. And two, you must still manage those important things. Spend $20,000 training 10
people in a special skill. What's the benefit? "You'll never know," answered Deming. "You'll never be able to measure it. Why did you do it? Because you
believed it would pay off. Theory." Deming is often incorrectly quoted as saying, "You can't manage what you can't measure." In fact, he stated that one of the
seven deadly diseases of management is running a company on visible figures alone.
"Joy in work" the phrase, originally "pride in work" was amended to "joy" by Deming in 1988, after David Kerridge, professor of statistics at
Aberdeen, pointed out that "joy" in labour was found twice in the Book of Ecclesiastes.